Investing

11/18/2014

Continual planning is essential for finding opportunities that will reduce the financial burden. Several options exist to help corporations retain wealth and reduce taxes legally.

At the end of the business year 2014, companies will be examining data to see if there are any tax savings available on defined contribution, benefit, cash balance and 401(k) plans.

A recent article on theInsuranceNewsNetwebsite, titled “Important Tax-Planning Tips for Business Owners In 2014,” states that retirement packages can decrease tax liabilities by deferring income. The original article notes that gathering this data will allow business owners to make informed decisions about potentially accelerating deductions and deferring income into the next quarter. Compiling financial projections and reports is extremely important for proper tax planning.

The original article also reminds us that integrating personal tax planning into the company tax planning allows state income, real estate and mortgage taxes to offset business revenue. Your business planning and estate planning attorney will be able to suggest solutions such as legitimate tax shifting by employing children, who can start a Roth IRA, along with the tax benefits of continuing education.

There have also been two pieces of tax extender legislation passed by the Senate and the House which would extend provisions for businesses—bonus depreciation, generous donations for S corporations, smooth transitioning from C to S companies, and a $25,000 reduction on Section 179 expenses.

Next year the Affordable Care Act's employer mandate will go into effect for companies with more than 49 full-time employees. Appropriate health insurance for employees must be documented for compliance, and with this companies are looking into various tax options.

According to the original article, you need to integrate your estate planning into your corporate structure to reduce the size of your estate, and business owners may also consider giving shares to family members who are in a lower tax bracket.

An attorney experienced in business and estate planning at Redkey Gordon P.C. can help you make the right strategic moves as the year comes to a close.

11/17/2014

Cash-strapped millennials are slipping into the red.In fact, their savings rate has dipped to negative 2%, meaning that they're spending more than they have.

The unemployment rate was down to 5.8% last month and the U.S. economy added 214,000 jobs. However, a recent article on the CNN website, titled “Millennials aren't saving a dime,” reports that most millennials are in trouble even though the job market looks brighter.

Keep in mind, wages have remained flat without much increase since back in the 1990s. As a result, even with good news about jobs and the low unemployment rate, millennials continue to have a rough time making ends meet.

In addition, another negative factor is their student loan debts.

The original article explains that things were a lot worse just a few years back. Moody's reported that millennials had a negative savings rate from 2004 to 2009, and in 2007 they hit rock bottom with a deficit of about 15%. They recovered in 2009 and were treading water until 2012, when they again went under.

Many college-educated millennials have been fortunate to land professional jobs, but they have limited upward mobility because some baby boomers above them are facing similar money crunches and aren’t retiring early.

Aside from savings and basic financial planning, once adulthood is reached estate planning should be a part of everyone’s budget.

Talk with an experienced Sacramento estate planning attorney and see what you can do, even with limited finances, to save and plan for the future of your estate.